Climate activists have long been calling on organisations to put their money where their mouth is when it comes to climate action. Many companies have extensive PR campaigns or CSR programmes espousing how green they are, yet hold investments that tell a different story. Now the climate movement has actively started naming and shaming those that continue to invest in the dirty energy industry, including corporations, academic institutions and even philanthropic organisations.
The recent divestment movement has struck a personal nerve, both because the topic is out of my comfort zone and because it means giving more thought to my own investments. While fossil fuel companies and the financial networks supporting them often came up in my work, I assumed it was enough to campaign against them in a vague sort of way. But as the global divestment movement gained momentum, I realised I could unintentionally be supporting the very companies I protested against, through ignorance about where my investments lay.
Global Divestment Day was held on 13 and 14 February this year, calling on individuals, companies, governments, academic institutions and other organisations to take their investments out of fossil fuels. While activists have called for divestment in disparate ways over the years, the populist movement now sweeping the globe began around three years ago, when students started demanding that their universities pull funds from companies destroying the planet. Since then, over 20 colleges and universities, including prestigious institutions like Harvard and Stanford, have withdrawn all investments from fossil fuels. In total, hundreds of organisations, local governments and individuals – together representing $50 billion in assets – have also pledged to divest.
As many have pointed out, financial and political support of fossil fuels is in direct contrast with what scientists are telling us – that we need to leave 80% of fossil fuel reserves in the ground in order to stay below the agreed upon target to avoid dangerous climate change. Yet, the known fossil fuel reserves are almost five times that number, meaning that if we burn all the deposits that have been identified for extraction, any hope of staying within a safe threshold will be obliterated. These two numbers are completely irreconcilable.
The local branch of the divestment movement, Fossil Free SA, was set up in late 2013, with a call on the University of Cape Town to pull its investments in fossil fuels. Spearheaded by David Le Page and Robert Zipplies, Fossil Free SA now has chapters in Johannesburg, Cape Town and Durban, as well as smaller towns such as Howick. Following continued engagement with Fossil Free SA, the University of Cape Town has committed to an ethical investment strategy that may include fossil fuel divestment – something Fossil Free is “cautiously excited about”.
It’s not only big companies or institutions that need to change their approach – individuals can make a huge collective impact, by choosing not to support banks or funds that invest in unsustainable industries (often obliquely labelled as ‘minerals’ or ‘materials’ in fund portfolios). Divestment is an important and timeous movement because it speaks to so many aspects crucial to spurring change – shining a light on where people’s money is going; re-directing these funds to cleaner alternatives like renewables; and encouraging people to ask more pointed questions about the funds and organisations their money is invested in. This is a huge enabler for those who may feel powerless about changing their role in the global climate challenge.
I struggle with the fact that I begrudgingly support the fossil fuel industry by filling up my car, using electricity and buying goods and services dependent on fuel. But I get to decide whether I give it anything beyond that. So does everyone else –and it’s a choice that is becoming critical.
*In this context, stranded assets refer to fossil fuel operations that cease to be economically viable as a result of regulatory or market changes.